Before Justices Douglas, Gibbons, and Parraguirre. Opinion by Justice Parraguirre.
In this appeal from an amended judgment following a bench trial, the Court examined whether the Carmack Amendment preempted a shipper’s state-law claim for conversion. Respondents/Cross-Appellants purchased a luxury sports car and contracted with Nex-Day Auto Transport to facilitate its delivery to Washington State. Nex-Day then advertised the job on an industry website, and received an offer from Appellants/Cross-Respondents to transport the car. Nex-Day faxed a work order to Appellants, and required a signed copy to complete the agreement, which Nex-Day never received. Nex-Day faxed Appellants a cancellation, and proceeded to solicit other carriers. The following day, a driver employed by Appellants arrived at the car dealership and loaded the vehicle onto a carrier, despite the protests of a dealership representative. Appellants then transported the car to Washington State, but instead of completing delivery, they held the car as ransom, demanding that Nex-Day pay for past-due invoices for prior work Appellants had performed for Nex-Day. Nex-Day failed to pay these past-due amounts, and the car was ultimately transported to a storage facility in Missouri. Respondents brought an action against Appellants, claiming, among other things, conversion and fraud. Nearly a year and a half after filing its answer, Appellants filed a motion to dismiss under NRCP 12(b)(5) on the basis that Respondents’ claims were preempted by the federal Carmack Amendment, which limits liability for interstate cargo carriers solely to the “actual loss or injury” to goods that occurs during interstate transit. The district court denied the motion, on the basis that the Carmack Amendment did not apply in instances of conversion and fraud. The Court examined Ninth Circuit precedent in affirming the district court’s judgment, holding that in instances of “true conversion,” such as occurred in this case, the Carmack Amendment does not preempt state law conversion claims. It noted, however, that other federal case law suggested that fraud claims are typically preempted. The Court quickly rejected Appellants’ claim that the district court’s judgment was not supported by substantial evidence, and upheld the district court’s award of compensatory and punitive damages. It noted that three other arguments made by Appellants had not been preserved for appeal because Appellants did not raise these arguments at trial, and failed to provide relevant authority for these arguments on appeal. Affirmed in part and dismissed in part. (Jeff S. Riesenmy, Associate in the Las Vegas office of McDonald Carano Wilson.)
